DRO Revoked

lianse_2

I had a DRO issued in December because I had no income other than benefits and could not afford to pay my credit card payments. Since then I received a lump sum as a PPI refund and because this took me over the £300 they allow you to have as assets they have now revoked my DRO. However I still cannot afford to pay the credit card and the money l had as a lump sum does not cover what is owed.
I was wondering if I could offer the credit card company this lump sum as a settlement? I owe them £4000 and I have £1200 I can use towards the debt.
Can I arrange a settlement with them or would it have to go to a debt collectors first?
Since my credit report is now ruined for the next 6 years due to the DRO, even though it has now been revoked, should I even bother paying anything at all to the credit card company and just let them eventually hand it over to a debt collectors or should I try to come to some arrangement with them directly?

tigerfeet2006

Is the £4k all your debt? Do you have anything else?

lianse_2

yeah the 4k is all my debt, I don't owe anything else to anyone. Well theres £74 i owe the catalogue but I can pay that. My partner owes some money on a credit card but thats in their name only so nothing to do with me really. other than that nothing is owed to anyone.

debt_doctor

.....Or should you spend £600 over next 3 months or purchase essential goods and go bankrupt with the remaining £525?

DD

tigerfeet2006

But DD is it worth going BR over £4k?

My gut instinct is to try and go for a full and final. If you ask on the Debtfree Wanabe board they will take you through the process.

http://forums.moneysavingexpert.com/forumdisplay.php?s=&daysprune=&f=76

debt_doctor

But what is the difference between DRO and BR for this person? They have no assets (car??) and will not get IPA, restrictions are the same for both insolvency methods.
If they were 'happy' to be in a DRO then I would have thought they would feel similar about BR.

DD

lianse_2

No I have no car or anything, the only thing i have that can be classed as an asset is this lump sum of money.
I just want to get rid of the debt, as I am suffering with a lot of anxiety and depression and to get rid will mean one less thing to worry about. my credit report is messed up now anyway from the DRO as far as I understand it as I have been told even though it has been revoked it will still show on my credit file for the next 6 years. I guess the less I add to it the better though, I dunno, not really sure how it would work or what difference it would make to add a BR on there too.

debt_doctor

You need to consider your options, but from a credit file point of view a DRO and BR amount to the same effect. The BR would remain on file for a few months after the DRO (depends how far in you was to your DRO).
Did no one advise you not to claim PPI until after DRO?

DD

lianse_2

I had put in a claim for the PPI for a specific loan account I had had in the past before I took out the DRO and received a reply to say there was no eligible PPI on the account. I then took out the DRO thinking no more of it, but then the bank came back to me after I took out the DRO to say they had checked all my other past accounts and will pay me this money. I had not asked them to check any of these other accounts because I only recalled having insurance on the first one so it is just something they just did themselves. On one hand it's good because I got this money I did not think I was owed and would not have got if they had not checked, but on the other it's a bad thing because now I have this debt to worry about again.

fiveyearplan

BR also affects any insurance you may have for the rest of your life. You have to declare it if asked. I agree with TF, i would try and come to a F&F with the credit card company. I'd start by offering them £800 and see what they say.
Make sure they know it is for a Full and Final settlement though.

debt_doctor

fiveyearplan wrote: »

BR also affects any insurance you may have for the rest of your life.

Does it? It's never affected any insurance (car, life and contents) that I have.

You need to consider your options which appear to be;

Do nothing.
Full and final settlement.
Token offers.
Bankruptcy.

DD